A CORRUPT south Warwickshire pensioner has been jailed after taking part in a £245million scam which has led to one of the country’s biggest fraud investigations.
Michael Bancroft, of Ilmington, has been jailed for ten years after taking part in a decade-long fraud involving bank employees and private business advisors.
The 73 year-old businessman was part of a gang which bribed bank manager Lynden Scourfield with cruises, designer watches and five star hotels.
In return Scourfield agreed to inappropriate loans for struggling businesses which enabled the fraudsters to profit from high consultancy fees.
And while many of the businesses went bankrupt, owners lost their homes, and the bank lost money, the gang – led by David Mills – led lavish lifestyles.
Bancroft used the money to fund several homes – including one in Long Marston, York and another in Portugal – and also enjoyed holidays to Thailand and Barbados.
He was convicted of conspiracy to corrupt, three counts of fraudulent trading and one of conspiracy to conceal criminal property following a four-month trial at Southwark Crown Court.
The fraud case by Thames Valley Police – known as Operation Hornet – was one of the country’s biggest ever and more than three rooms were needed to hold the evidence amassed.
Bancroft was jailed along with Mills and his wife Alison, Mark Dobson and John Cartwright.
From 2002 to 2007, Scourfield worked at the high risk assets office of HBOS in Reading, handling business customers who were at risk of defaulting on their loans. Dobson was a director based in London working in a similar role.
Scourfield managed a portfolio of businesses for the bank and agreed loans on the condition they would use a business consultancy to help restore solvency.
His preferred consultancy was Quayside Corporate Services which was run by David Mills and employed both Bancroft and Cartwright.
In his role at the bank Scourfield was supposed to have loans approved by a senior manager – a so-called ‘second pair of eyes’. Failing to have them approved, he gave the green light to loans for companies which were already in trouble. In order to receive these loans each business had to purchase the services of a business consultancy firm to help them get back into profit. There were more than 200 of these ‘turnaround’ firms available to Scourfield to choose from, but he chose Quayside and others owned by Mills and wife.
These consultancies would charge already struggling companies vast sums of money for their business advice. The firms would have to pay back the loans and interest to the bank plus the consultancy fees and inevitably would need to borrow more money to continue trading.
Scourfield agreed these loans without a “second pair of eyes” sanction.
This cycle of debt would continue past the point where it was likely the bank would get its money back. Eventually the loans were written off as a loss.
The fraudulent activity came to light in 2006 when Scourfield had a new senior manager at the bank who asked to check Scourfield’s previous loan applications.
Thames Valley Det Supt Nick John, said: “This has been the longest and most complex case in our history.
“I hope that this case offers closure and justice to the victims of this organised crime group. These are normal hard-working people who have had their lives and had their livelihoods ruined.
“I also want to congratulate the Operation Hornet team for successfully bringing this mammoth case to trial after a six and a half year long investigation.”